Why America needs Canadian farmers

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Tom Campbell has lived the American Dream. A dream that had its beginnings in the nutrient-rich soils of North Dakota’s Red River Valley, where, once upon a time, he was raised as the son of a humble mail carrier in a swath of country characterized by rich and prosperous sugar beet and potato farmers.

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His father was neither rich nor prosperous, but worked a steady job while also tilling a small plot of land that produced some grain and barley, but certainly didn’t produce the big bucks that the big farms across “the road” enjoyed and that a young Tom and his brothers aspired to.

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The Campbell boys were fresh out of high school in 1978 when they took their shot at the good life and showed up at the bank on the nearby town’s main street for a meeting with a loan officer. They had no collateral, no working capital and nothing much to speak of whatsoever, save for a wealth of youthful enthusiasm and character, which was enough to get them a US$9,000 loan to buy some “junk” equipment and then plant and harvest their first potato crop.

“The farmers across the road were laughing at us, but, you know, I was living the American dream and I loved it,” he said. “Ever since then, there’s been nothing but good news and expansion, and that’s how I came to meet Wayne Rempel at a potato growers’ meeting in Texas in 2000. I consider Wayne to be one of my closest friends.”

That feeling is mutual. Rempel, who is renowned for his field management strategies and above-ground irrigation solutions, is a dreamer, too, but his potato creation story has its roots in the Red River Valley soil near Winkler, Man., an hour north of his buddy’s North Dakota spread. The international border has not prevented friendships or business relationships between American and Canadian farmers from sprouting over the years.

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For example, there are the Manitoba spuds — colourful red, yellow and white organic varieties — that Rempel’s company, Kroeker Farms Ltd., grows and trucks south for sale in high-end American grocery chains, such as Whole Foods Market Inc.

“The U.S. is an incredibly important market for us,” the chief executive said from his company’s headquarters in Winkler.

On the flip side, what Canadian farmers grow and export south is incredibly important for American consumers, a generally well-fed bunch who annually gobble down billions of dollars’ worth of agricultural products from north of the 49th parallel and open presents in the presence of Canadian-grown Christmas trees. As a result, there will be plenty of pain to go around as Donald Trump ramps up his trade war, but Canadians would not be alone in feeling the hurt.

Case in point: nearly 65 per cent of Kroeker Farms’ annual potato crop finds its way into American kitchens, a haul of spuds that requires about 6,000 tractor-trailer trips to transport, which, by any measure, is no small potatoes, but still a fraction of the $3.6-billion worth of potatoes and potato products, such as chips and frozen fries, that Canada exported in 2023/24, almost 93 per cent of which went to the U.S.

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Donald Trump, I’m a big supporter — I voted for him. But there are a lot of things I don’t care for

North Dakota farmer Tom Campbell

It is a statistic an American dreamer digests with a simple observation that were Rempel and the rest of Canada’s potato farmers to cease sending their products south in the event of a tit-for-tat, 25 per cent tariff trade war initiated by Trump, the U.S. would be caught in the grips of a potato famine of sorts, given the average American consumes 24 kilograms of the food item per year.

In addition to all those potatoes is close to $7-billion worth of invented-and-grown-in-Canada canola oil that American fast food chains, such as Jack in the Box, use in their deep fryers.

“Donald Trump, I’m a big supporter — I voted for him,” Campbell said. “But there are a lot of things I don’t really care for; he can be a bully; he can be a tough negotiator; it is all about America first, but trade, imports and exports, it is very complicated; it is complex.”

Now, don’t go getting the wrong idea: friendly as he is with Rempel, and mistaken as he often has been over the years for being Canadian, perhaps due to his hard-to-place accent and the fact the Campbell family tree includes some French-Canadian branches, he is a proud Trump supporter and a former North Dakota Republican state senator. He has even met the president.

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But his support has its limits, including his personal view that picking a trade fight with Canada is probably an example of picking on the wrong country.

Free trade isn’t about America first, he said, but a detailed, negotiated and agreed-upon cross-border arrangement in which all parties theoretically come out ahead.

The United States-Mexico-Canada Agreement and its Canada/U.S. antecedents prior to Mexico joining in have yielded a “pretty fair deal” overall for both Campbell and his Canadian farmer “friends,” he said.

Tariffs on agricultural products could strain the limits of that friendship, but a trade war might also give Canadians, toiling away in major cities and oblivious to the bounty nearby, a long overdue revelatory jolt.

“Canada is an agricultural superpower,” Evan Fraser, director of the University of Guelph’s Arrell Food Institute, said. “If any country is poised to benefit from a changing climate — and a growing global population — it is Canada, with its capacity to increase its production, feed the world and grow its exports.”

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In brief, Canada has the land and also harvests from the seas. Be it a crop or a snow crab, wheat processed into a baked good, a potato unearthed from a field in Winkler or a tropical plant cultivated in a greenhouse, the fruits of the country’s agricultural efforts produced about $100-billion worth of exports, 60 per cent of which went to the U.S. in 2023, compared to $45 billion in imports from our neighbours to the south.

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Sure, Trump may pop off about American exceptionalism, but it is Canada that comes out ahead on the agricultural trade balance.

The bad news, if a food fight were to erupt with the Americans, is that no matter how you crunch the numbers, the same painful end results for both Canada and the U.S.

“If moving stuff across the border becomes more expensive and more complicated, and the transaction cost of growing the food system goes up significantly, then we have got lots of evidence to say that when costs rise, two people suffer, and it is generally the farmer, in terms of lost income, and the consumer, in terms of higher prices at the store,” Fraser said.

Canada is an agricultural superpower. If any country is poised to benefit from a changing climate it is Canada

Evan Fraser, University of Guelph Arrell Food Institute

As for the good news, Canada’s nearly 200,000 farms occupy 6.2 per cent of the country’s land mass and are home to some of the nation’s great unsung innovators.

Farmers talk, and if something seems to be working for the agriculturist on the other side of the fence, word gets around, as it did when canola first came on the scene nearly 50 years ago. Farmers are also uncanny copycats and aren’t afraid to borrow a good idea when they see one.

What Stan Vander Waal’s Dutch-born father saw when he looked around northwest Iowa in the mid-1970s was somewhere he did not want to be anymore, so he uprooted his brood and moved them to British Columbia.

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The Vander Waal patriarch grew crops and raised cattle in Iowa, but fresh-cut flowers proved a more attractive calling north of the border. The same has held true for his son, who, with his wife Wilma, followed in his old man’s footsteps and built their first greenhouse in Chilliwack, B.C., some 40 years ago.

Wilma hand-painted Rainbow Greenhouses Inc.’s sign out front and kept the books for a small business that has since grown into a Western Canadian plant-and-flower-growing empire, with 130-acres worth of greenhouse space in Alberta and B.C. and 1,000 employees during the peak season.

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“I quite like growing flowers better than cattle,” Vander Waal said. “They’re a lot cleaner, they don’t give you so much pushback, and it’s a much better business to be in.”

Nearly 100,000 Dutch immigrants came to Canada between 1947 and 1954, and 80 per cent of them were farmers. Among the innovations that arrived with the newcomers and that Canadian flower growers adopted was the so-called Dutch live auction clock system.

Never heard of it? Well, imagine you have a lot of fresh-cut flowers to sell. The auction clock starts with the flowers listed at a maximum price and it keeps winding down until a bidder decides the price is right and buys the plants. The system eliminates protracted bidding wars and displays of one-upmanship and ego. Speed is of the essence, especially when moving a commodity to a market that positions freshness as a major selling point.

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“The Dutch are known for innovation and expertise in the floral industry,” Vander Waal said.

By adopting the Dutch auction method, and borrowing bits and bobs related to cultivation and optimal flower varieties to grow, Canadian flower farmers have been able to penetrate the American market to the tune of about $1 billion in annual exports. That number includes about $100-million worth of Christmas trees.

“For a lot of Americans, I think talk of tariffs is not really something that hits their radar,” said Vander Waal, who was born in New Jersey and still has family in Iowa.

But where the tariff talk registers with him isn’t on the export side — since only about seven per cent of his sales head south — but on the import side.

Canadians might be aces at growing flowers, tropical ferns and the like, but the seeds the plants grow from, the fertilizers that nourish them and some of the equipment involved to get the job done are imported from the U.S.

Vander Waal could lose all his American customers overnight and live to fight another day in a trade war. But if Canada were to hit back at the U.S. with counter-tariffs, and his input costs on necessary imports abruptly ratcheted up by 25 per cent, it is safe to say that he’d have a big problem on his hands.

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But Trump aside, what he most wants to see amidst a tense time is for Canada to look inward and to innovate. For example, if a greenhouse magnate wanted to build, say, a new greenhouse, the permitting process used to take three months. Today, it takes 18 months or more. Toss in a stray shard of pottery unearthed during excavation and you may as well cue the start of an archaeological study that could drag on interminably.

The point? Trump is a problem, but he is not “the problem,” according to Vander Waal. The biggest headache for many Canadian businesses in recent years is an ever-thickening bureaucratic bible of red tape that stifles innovation and frightens off investors. Put another way, Canadian governments need to get with the Dutch program and make haste.

We need to look in the mirror and say, ‘What can we do better?’

Stan Vander Waal, Rainbow Greenhouses Inc.

“We need to look in the mirror and say, ‘What can we do better?’” he said. “And what we can do is remove the obstacles, the excess policy and the red tape that’s killing us from being successful. Let’s get out of the way of ourselves.”

Meanwhile, back in Winkler, Wayne Rempel has been thinking a lot about Mexico, and not because of the weather. Among the major innovations Kroeker Farms has made during his 20-plus years as CEO is recognizing what it has.

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For decades, the company tried to be all things to all potato buyers. Kroeker Farms spuds were processed into chips and frozen fries, and sold alongside other potatoes in mainstream grocery stores. What the company needed was an identity, and it would discover it in the dark, loamy Red River Valley soil by becoming growers of high-quality, organic, bound-for-American baby potatoes.

“The soil here is soft, so you can harvest potatoes without bruising the skin or doing any damage, but the soil also produces a really nice bright red skin — and a nice shiny yellow skin for yellow potatoes — so you get a higher-quality product and, at the end of the day, a better price for it.” Rempel said.

It would be difficult to pivot from his American customers in the face of tariffs, but with all the uncertainty and a fresh crop of baby spuds to plant come spring, he has been exploring opportunities in Mexico.

Maize is the dietary staple there, but Rempel reasons that a Canadian product, one aimed at more affluent consumers who may just harbour a sudden distaste for American heavy-handedness, might catch on, or at least keep his farm afloat until the trade war storm passes.

Among those paying attention to the metaphorically darkening skies is Rempel’s pal, Tom Campbell. The North Dakota potato man said one of the advantages Canadian farmers enjoy, but don’t necessarily go around blabbing about, is that exporting to the U.S. means getting paid in American dollars.

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Given the exchange rate, a Canadian farmer could, in theory, “eat the tariff,” he said, but that is assuming they have enough financial wiggle room. If there is no wiggle room, they are going to be hard-pressed to make a go of it because the margins are thin enough for farmers as is.

Campbell grows potatoes, but he also acts as a potato broker, a.k.a. a middleman. He buys from Canadian farmers — including his buddy Rempel — and then sells them to Whole Foods and other points across the U.S.

“We love Canadians,” he said. “But we can’t subsidize. It is very simple, basic mathematics, and if the Canadians want to be competitive and eat the tariff, that would be up to them, but if the percentages don’t work for us, we just won’t buy from them. We won’t do the deal.”

The Trump fan is hopeful that things never actually come to that, and that the president’s tariff threats are a negotiating ploy. But if the worst does come to pass, Rempel said he understands that business is business, and there would be no hard feelings if Campbell was forced to cut Kroeker Farms loose. A friendship between two potato men is bigger than any president could ever be.

“Tom might be an American, but we are both potato farmers and we are good friends,” Rempel said. “I spend half my summer weekends in Minnesota, where Tom has a lake house. He doesn’t like tariffs on agriculture either, because it hurts American farmers. This idea of tariffs on food and agriculture just doesn’t seem right.”

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